December 8, 2005
Consumer-geared health plans less favored – study
By Lewis Krauskopf
NEW YORK (Reuters) - Americans enrolled in medical coverage
plans designed to make them more aware of health-care costs are
less satisfied and more likely to put off medical care than
those enrolled in traditional plans, a survey released on
which U.S. insurers are embracing as part of their growth
strategies. These plans combine high deductibles with
tax-preferred savings accounts or employer-funded accounts,
which consumers use to pay for their medical care.
According to the survey, more than 70 percent of those
enrolled in consumer-driven programs said their plans made them
consider costs when deciding to see a doctor or fill a
prescription compared with fewer than 40 percent of those
enrolled in traditional plans, which had lower deductibles.
But 35 percent of those enrolled in consumer-driven plans
reported delaying or avoiding medical care, compared with 17
percent of those in traditional plans.
The percentage difference was even more pronounced for
consumer-driven enrollees with incomes under $50,000.
The study surveyed about 1,700 residents over the Internet
and was co-sponsored by the Commonwealth Fund, which says it
supports independent research on healthcare issues, and the
Employee Benefit Research Institute.
"These findings provide evidence that high-deductible and
consumer-driven plans may undermine the two basic purposes of
health insurance: to reduce financial barriers to needed care
and protect against high out-of-pocket cost burdens for
patients," said Karen Davis, president of the Commonwealth
Proponents of consumer-driven plans say they will encourage
people to be savvier healthcare customers. Under traditional
coverage plans, they say, consumers need not worry as much
about the actual costs of their healthcare.
The consumer plans in the survey had deductibles of $1,000
or more for individuals and $2,000 or more for families.
Consumer-directed plans also involve tax-preferred
accounts, to which consumers and/or employers contribute money.
Consumers use either money in those accounts or pay
out-of-pocket until reaching their deductibles, and then
coverage kicks in.
Relatively few people are enrolled in the consumer plans.
The survey found 10 percent of privately insured U.S. residents
of ages 21 to 64 are enrolled in a high-deductible plan. Most
of these are in plans that lack an accompanying savings
account, according to the survey.
According to the survey, enrollment in these plans is,
however, expected to grow.
The survey found 63 percent of those in traditional health
insurance, such as Health Maintenance Organization or Preferred
Provider Organization, or other plans with relatively low
deductibles, were extremely or very satisfied with their health
plans, compared with 42 percent in consumer-directed plans.
Thirty-one percent of people enrolled in consumer-directed
plans spent 5 percent or more of their incomes on out-of pocket
costs plus premiums in the past year. That compares to 12
percent in traditional plans.